Observations on economics, the academy, the wider world, and things that run on rails.

25.2.16

IT'S ALL ABOUT THE TRADEOFFS.

Going on eight years ago, Newsweek got involved in the work-life balance debate then raging in the presidential campaign with an attempt to be provocative about upscale working moms.

Sarah Palin has nothing on Christopher Ruhm. On Thursday, the University of North Carolina, Greenboro, economist published a study showing that kids from high-socioeconomic-status families take a long-term hit when their moms work outside the home—at ages 10 and 11, they perform more poorly on cognitive tests and are also more likely to be overweight than those whose high-status mothers leave the workforce. Children from low-status families, on the other hand, don't seem to suffer as much when their moms work. In fact, many of them do better on the same tests, and they're more fit, than similarly disadvantaged kids with stay-at-home moms.

The findings are surprising, and it's easy to read them as a warning to affluent, educated mothers: if you want the best for your child, don't work. (Conversely, if you're not well-off: get your kid to day care.) But those are dangerous conclusions to draw from the study, and even Ruhm—whose own wife worked while raising their children—says so. "This comes down to a fundamental principle of economics: something has to give. We can't have it all," he says. "But I would never tell anybody what to do or not do about that. I certainly wouldn't tell my wife." So what are women facing a choice between work and home—and those many more for whom work is an economic necessity—supposed to make of these findings?

As with all non-experimental analyses, caution must be taken in providing a causal interpretation to these findings. Compared to most previous research, however, particularly comprehensive controls for non-random selection into maternal employment are included and some effort is made to investigate reverse causation – where child outcomes influence future labor supply. Remaining omitted variables biases may lead to underestimates of the adverse effects and reverse causation is probably more important for low than high SES families. The qualitative pattern of results, however, seems unlikely to be strongly affected.

There's a good deal of prior research on the topic, although a quick check of Google Scholar doesn't turn up any obvious ripostes or extensions. Here's how Mr Ruhm frames his finding.

The results suggest that maternal employment has small average effects but sharply disparate impacts across categories of youths. Moderate labor supplies is estimated to have no impact or to benefit “disadvantaged” children and long hours, which occur rarely, are unlikely to leave them much worse off. By contrast, maternal job-holding is predicted to have deleterious consequences for “advantaged” adolescents. One reason for the negative effects on cognitive development is probably that these children are removed from enriching home environments when their mothers work. The elevation in obesity is less easily explained, although the data suggest a role for determinants common to both the child and mother (like family eating habits).

The translation into more laymanlike language at Newsweek elaborates, but says the same thing.

Why do mothers' choices have such different effects on kids, depending on their socioeconomic situations? Most likely, says Ruhm, the low-status kids get more intellectual stimulation in day care or with other caretakers, such as grandparents, than they do at home. Meanwhile, the high-status kids may find day care less enriching than being with their highly educated mothers. When these moms go back to work, "you're pulling the [high-status] kids out of these really good home environments," says Ruhm, "and a lot of the alternatives just aren't as good."

The same pattern was true of weight: low-status kids weren't any thinner or fatter depending on what their mothers did, but high-status kids with working moms did have a slightly higher risk of being overweight at 10 or 11. The biggest effect on weight came when mothers were working during their high-status children's school years. Maybe, says Ruhm, these moms didn't have time to cook healthy dinners and after-school snacks: "If you're working a lot and you're eating out and buying fatty food, that could have an effect on obesity later in the child's life." Or maybe those kids were left unsupervised more often, and thus had more opportunities to eat cookies in front of the TV—and fewer opportunities to run around outside. "Parents who are working but want to make sure their kids are supervised and safe will often load up the house with sedentary activities, since they can't always be there to take them to sports or to the park," says Karen Eifler, an associate professor of education at the University of Portland. "Their kids are more likely to have a TV or computer and videogames in their room—and also, the higher your economic status, the more likely you are to have those three machines in your house."

Capital assets matter. Some are physical, some are human, and some are social.